Xtrem Energy Drink from Spain to be Produced and Distributed in US

MIAMI, May 25, 2005 – Xtrem Energy Drink will be produced and distributed in the United States by Power Drinks, the recently established American company with headquarters in Miami, Florida.

“We have no doubt that Xtrem will soon become a key player in the US energy drink market”, said Faustino Martinez, founder and CEO of Power Drinks. “Our efforts in Research and Development pay back with second to none products like Xtrem. We plan to continue innovating and increasing our product categories. We have identified 12 product lines of “New Generation Drinks” and we have already registered 8 different brands that will be launched between 2005 and 2006″.

Xtrem was designed back in 1999 in Spain, and for the first years it proved to be the energy drink with fastest growing demand due to its unique taste and the efforts of Enerdrinks, owners of the formula, to create a solid brand image.

In 2001 Enerdrinks established successful licensing agreements in many other European countries including France, UK, Italy, Germany, Finland, Switzerland and Greece. Xtrem is now present in more than 20 countries and is already the preferred energy drink by many consumers in Europe.

In September 2004, Power Drinks, exclusive licensee of Xtrem for the U.S., Latin American, Canadian and Asian markets, established its headquarters in Coral Gables, Florida. During its initial months of operation, it has secured distribution agreements in Colombia, Ecuador, Peru, Mexico, El Salvador, Honduras, Guatemala and Costa Rica.

Originally marketed to athletes, and then almost exclusively to young people, the energy supplements category is moving rapidly into the mainstream. Sales of energy bars, energy drinks, and liquid/power protein drinks advanced from $2.0 billion in 1998 to $5.0 billion in 2003. Mintel projects sales will reach $8.0 billion in 2008. Younger adults and athletes still form a core consumer group for the category, but older consumers are quickly adopting the newer protein drinks and energy bars. According to Scott Folkins, Power Drinks VP of Sales and Marketing, “much of this new acceptance has come on the heels of new product formulation breakthroughs precisely at a time when older adults were looking for healthier foods and beverages. With the rise in consumer interest in health and the decline in the soft drinks market, the functional drinks sector appears to be where the new growth lies. Energy and sports drinks are moving into the mainstream and are used in multi-purpose situations “.

¨Our initial efforts will be focused in the Southeast and the Southwest, as we have identified Florida and California as the two main markets in the US¨, continued Scott. According to AC Nielsen market research, the US market size for energy drinks worldwide is over $ 1,9 billion. The market is not only big but it is projected to grow over the next 5 years at a 20% per year. In the US, sales reached approximately 60 million cases in 2004 with a 74% growth rate over 2003. In Florida, 4.3 million 8oz. cans were purchased by consumers in 2004.

Independent Focus Group analysis developed by the Metropolitan Center and the Florida International University showed that Xtrem was the preferred Energy Drink over the leading brand in the sector. As described in the report, “it is sweeter, fruitier and smoother with no bad after- taste. Also appealing is the carbonation of the drink”. “Our product is different and better and the market will identify Xtrem as their number one choice”, pointed out Scott.

“We are very content with our decision to establish our headquarters in Miami” stressed Faustino Martinez. Xtrem’s efforts to promote its involvement with the community will consist of supporting sports and health-related activities through sponsorship agreements with regional and national sports organizations. “Our consumers also enjoy nightlife, so we will be involved also in a series of night club events”.

About Xtrem
Xtrem is the energy drink distributed by Power Drinks, exclusive licensee for U.S., Latin American, Canadian and Asian markets. Power Drinks was founded in September 2004 in Miami, Florida. During its first months of operations it developed distribution agreements in many countries in South America. 2005 will be the year for its expansion in the U.S.